Economic activity pace rises in March: Midday roundup

The latest Westpac-Melbourne Institute Leading Index shows the pace of economic activity in three to nine months was at 3.9% in March, increasing by 1.4% since October last year.

In March alone the index increased by 0.5 points from 289.7 to 290.3 points.

The boost in the rate of economic activity is courtesy of a smaller drag from corporate profits and an increase in United States industrial production.

Other factors which also influenced the pick-up were the share market rally and a modest improvement in productivity.

The Westpac-Melbourne Institute predict there will be a downturn in commodity prices in the next few months and ongoing weakness in non-mining business investment, and a poor global backdrop will result in the growth momentum struggling to be sustained.

Two Storm Financial investors sign settlement for $1.1 million

Bank of Queensland, Senrac and Macquarie Bank have agreed to pay $1.1 million to fully compensate two former Storm Financial investors for their financial losses when the business collapsed in late 2008.

The settlement, which does not indicate an admission of guilt, sees Barry and Deanna Doyle compensated for their losses following investigations into the collapse by ASIC.

Storm investors were advised to put all their money in the sharemarket prior to the financial crisis and many borrowed money against their homes and superannuation to buy shares.

In March this year, 1000 investors pursued a class action against Macquarie which was settled for $82.5 million. The settlement included an acknowledgement by the investors there was no wrongdoing by Macquarie.

Westpac Bank caught in world’s biggest money laundering prosecution

United States prosecutors have announced a $6.2 billion money trail which allegedly includes $38.4 million deposited in Westpac Bank accounts.

Prosecutors say the scheme is the biggest international money laundering prosecution in history and they’re alleging the trail was left by a Costa Rica-based digital currency exchange and processing company, Liberty Reserve.

Prosecutors said Liberty Reserve facilitated illegal activity and enabled international cyber criminals to conduct untraceable transactions.

“It was essentially a black market bank,” US attorney Preet Bharara says, as quoted by the ABC.

“Liberty Reserve deliberately operated in a way to attract and aid criminals who wished to launder the proceeds of their crimes – serious crimes including credit card fraud, identity theft, investment fraud, computer hacking, child pornography and even narcotics trafficking,” he says.

Shares fall as dollar continues to plunge

The Australian sharemarket has opened lower this morning following a modest lead from Wall Street overnight, as the Australian dollar has continued to fall.

The currency fell to a 19-month low this morning to just 95.55 US cents.

The benchmark S&P/ASX200 index was down 5.3 points or 0.1% to 4965.4 at 12.00 AEST, while in the United States the Dow Jones Industrial Average rose 106 points or 0.7% to 15,409.4.